Mayer "hates" Yahoo's search deal with Microsoft

Sources at Yahoo suggest CEO Marissa Mayer is looking for a way out of search deal with Microsoft

Nicole Kobie
18 Feb 2014

Yahoo may be looking for ways to exit its search deal with Microsoft, with reports saying CEO Marissa Mayer "hates" the partnership.

Four years ago, Microsoft and Yahoo finalised a decade-long deal that saw Yahoo's search powered by Bing, while Yahoo took over advertising sales, with revenue shared between the two firms.

Now, new reports have surfaced suggesting Mayer is looking for an exit strategy, adding weight to the rumours of last summer.

Speaking to tech site Recode, one source said: "The minute Marissa finds a way out of that deal without committing suicide, she will. She hates it."

However, as the report notes, almost a third of Yahoo's revenue is generated via its search deal with Microsoft - more than the struggling web company has previously proclaimed to, suggesting it's a successful deal for Yahoo.

Indeed, ZDNet pointed out that Microsoft's CFO for applications and services, Dave O'Hara, said in December that the partnership between the two firms was "in a good spot", adding that "friction" between the two firms had been eliminated by changes to the revenue model that saw more money go to Yahoo.

Even if Yahoo wanted out of the deal, the company will need to be patient: the first real break-clause is at the five-year mark, which comes in mid-2015. Yahoo can also break the contract if the Revenue Per Search (RPS) falls below a benchmark set by Google's own numbers.

Microsoft has had trouble reaching that RPS level, but hasn't seen levels low enough for Yahoo to break the contract, according to a report on SearchEngineLand.

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